How Does Mental Accounting Distort Our Perceptions

question 22

Multiple Choice

How does mental accounting distort our perceptions?

• A) Downplay loss
• B) Emphasize gain
• C) Both of the above
• D) None of the above

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Definitions:

Agent

A person authorized to act on behalf of another and subject to the other’s control in dealing with third parties.

Depository Bank

A financial institution where deposits are made, held, and managed; also facilitates financial transactions for clients.

Settlement

An agreement reached between parties in a dispute, where usually one party agrees to provide compensation to the other, ending the dispute outside of court.